Every year brings new employment regulations for companies to navigate. Add to that the new incoming administration and companies can expect even more changes as the year evolves. While we do not know exactly what 2025 will bring, we have some thoughts as to how it will start.     

FEDERAL

In January 2025, Republicans will control the White House and both houses of Congress with the support of the conservative-leaning Supreme Court. Many are expecting legislative and executive actions that will undo or reverse the direction taken under President Biden’s administration.

While we do not know exactly what that will entail, based on President-elect Trump’s platform during his campaign, many expect his administration to be pro-employer, reduce the tax burden of corporations and high-net-worth individuals, crack down on immigration, and implement tariffs.

RELATED: Special Report: Potential Trump Tariffs Could Have Far Reaching Impact On Merch Industry

Some expected impacts include:

Minimum Wage: Trump said during the campaign that he supports increasing the federal hourly minimum wage from $7.25 to $15.00 as long as it does not hurt small businesses. However, most Republicans and companies are not in favor of wage increases given the impact on the bottom line, so this is not expected to be a big push.

  • As with the DOL’s minimum salary threshold being vacated by a Trump-appointed federal judge, initiatives that provide for higher wages for lower-waged employees are not expected.


Employee Protections: While the Biden administration implemented and/or strengthened new protections for employees, Trump will probably direct his administration to be more employer-friendly by either rolling back some protections or only pursuing enforcement for the most egregious situations. Additionally, diversity protections and requirements may be rolled back and/or enforcement of claims minimally pursued.

Immigration: A big push for Trump, we can expect a crackdown on immigrants coming into the country. Companies that rely on low-wage workers for manual labor may find a shortage of people to fill their positions. Even in white-collar jobs, reduced visa opportunities for employees and their families may make it harder for employers to entice foreign workers to join their firms.

  • Some experts are also expecting that this will be one area where enforcement will increase with more ICE visits, Form I-9 audits and perhaps additional E-Verify requirements.


Labor Relations / NLRB: Trump is expected to replace the current staunchly pro-union General Counsel with a more employer-friendly counsel, as well as fill an open seat on the NLRB. While it will still consist of a Democratic majority, the General Counsel sets the direction for the NLRB so it will refocus on reducing the power of unions and protections for employees and not enforcing the cases pursued in the past four years.

RELATED: Chair Of DOGE Senate Caucus Begins Battle Against Swag

Independent Contractors: These rules have vacillated over the past three administrations. While the test for independent contractors often relies on an “economic realities” test, the standards for that test changes. The current rule relies on the totality of the relationship based on six factors while it is expected the new administration will go back to focusing on two factors as they did previously. 

Restrictive Covenants: The FTC’s plan to ban most non-compete agreements in 2024 was overturned by a Trump-appointed federal judge. Since most employers want the protections of non-competes and other restrictive covenants (such as non-solicitation and non-disparagement clauses), many do not expect this type of ban to be reintroduced.

STATES

In recent years, states have taken the lead on key policy initiatives due to prolonged federal inaction. While this gridlock may ease, states are likely to continue prioritizing measures that resonate with their constituents. The 2024 election-day ballot initiatives reflect this trend, with voters weighing in on several important issues.

Minimum Wage Increases: Voters in Alaska passed a measure to increase the minimum wage to $15.00 per hour by July 1, 2027; additionally, if the federal minimum wage is increased, the state’s minimum wage will automatically increase to $2.00 per hour more than that rate.

  • Voters in Missouri voted to increase their minimum wage to $15.00 per hour by 2026.
  • Surprisingly, California voters did not pass a similar measure, but their minimum wage will continue to increase as previously established.
  • You should also note that the minimum wage is already scheduled to increase in 22 states as of January 1, 2025.


Paid Sick Leave: Three states passed new paid sick leave laws which will go into effect in 2025.

  • Alaska employees will be able to accrue up to 40 or 56 hours each year (depending on the size of the employer) beginning July 1, 2025.
  • Missouri employees will be able to accrue up to 40 or 56 hours each year (depending on the size of the employer) beginning May 1, 2025.
  • Nebraska employees will accrue up to 40 or 56 hours each year (depending on the size of the employer) beginning October 1, 2025.


Marijuana: While three states failed to pass marijuana legalization, Nebraska passed medical marijuana with it becoming legal later in 2025. 

Access to abortion: While not directly an employment issue, employees needing medical care may be required to travel, thereby missing additional work time. It may also impact benefit coverage requirements. 

  • Voters in Nebraska passed a new abortion ban while also striking down an abortion protection law.
  • Voters in Florida and South Dakota also struck down measures to protect abortion rights.
  • Meanwhile, voters in Arizona, Colorado, Maryland, Missouri, Montana, Nevada, and New York passed laws to protect access to abortion.


Other employment areas that are expected to be a focus at the state level in 2025 include pay transparency, paid leave, protected groups, restrictive covenants, immigration protections, worker safety and climate change.

Other Challenges: In addition to the above areas, most employers will need to manage other workplace challenges including continuing reduced labor pool due to factors such as immigration and generational shifts; increasing operational costs; employees under personal financial pressures which may require them to look for other opportunities; and workplace tensions as the country continues to experience divides.

Through the HR Support Plan, The Workplace Advisors can help you stay up-to-date on the regulations, strategize how to manage the changes, and keep your handbook current. HR Support Plan members also receive our deepest discounts on Recruiting, Compliance, Compensation, Coaching, Organizational Development, and Assessments.

Paige McAllister is vice president of compliance at The Workplace Advisors, formerly Affinity HR Group Inc. The Workplace Advisors specializes in providing human resources assistance to associations such as PPAI and their member companies. To learn more, visit www.theworkplaceadvisors.com.